The Hindu Business Line : Mining body urges rollback of export duty on iron ore

Kolkata March 10 The Eastern Zone Mining Association (EZMA) has urged the Union Finance Ministry to roll back the proposed export duty of Rs 300 per tonne of iron ore in the Union Budget. The association has stated that imposition of export duty will result in a drastic fall in export of iron ore and fines and revenue expectations on this score will fall far short of expectations.

According to a spokesperson of EZMA, iron ore fines are not used by most steelmakers in the country. As such, this "waste" is used to level roads and fill up wasteland.

"We are not opposed to duty on export of iron ore that is consumed within the country. What is being exported is what cannot be consumed in the country. India exports about 100 million tonnes of iron ore per annum. Of this, 85 per cent comprises fines and accounts for about $40 billion worth of export earnings. Reduced exports will widen the country's trade deficit, which presently stands at over $50 billion," he said.

The spokesperson added that bulk of the MoUs signed with various State governments for setting up steel making capacities are through the sponge iron route, where iron ore fines are not used.

The association says that most of the iron ore fines from India are exported to China. If the export duty is imposed, Indian iron ore fines will become costlier than those imported from countries such as Brazil and Australia.

Besides, a reduction in export of iron ore would impact other sectors of the economy too. Ports in Vizag, Paradip and Haldia would be affected as iron ore fines account for 70 per cent of their revenue from export cargo.

"Sales of trucks for movement of ore and earth moving equipment will come down. Over 20,000 trucks ply daily between Barbil/Joda and Paradip port. Importantly, most of the fines exports are from non-captive mines that provide direct and indirect employment to over 10 million in backward and tribal areas. Their livelihood will be impacted," the spokesperson added.

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